What is a Travel Credit Card? Do you really need it? Know Everything about Travel Credit Cards

If you are traveling to multiple countries with different currencies is it feasible to carry a multi-currency cash or a bundle of traveler cheques? Of course not. A travel card is more convenient to carry and use. Travel credit cards are extremely useful for doing transactions without carrying any foreign currency when you are traveling in a foreign country. But the actual benefits are not only limited to this. Here we list out some very important details about travel credit cards that you should know before embarking on your international trip.

A travel credit card or traveler card is a type of credit card that offers attractive travel-related offers, exciting discounts, and unlimited savings for your international travel.

What are the different types of travel credit cards?

• Airline credit cards
• Hotel Credit Cards
• Flexible currency credit cards

Who should get a travel credit card?

If you’re a frequent international traveler who spends a lot of money on travel which means you’ll be more likely to reap the benefits of these cards.

Who should not get a travel credit card?

If you don’t travel frequently then you should not invest in a travel credit card. If you rarely fly then it is really impossible for you to get air travel fare and hotel stay benefits from a travel credit card.

How are travel credit cards different from other credit cards?

A normal credit card gives you rewards in the form of cashback or points which can be redeemed for gift cards, merchandise, and discounts but a travel credit card offers numerous travel-specific benefits.

How do travel credit cards work?

Travel credit cards earn you points or miles each time you make any travel purchases. Later you can redeem your travel rewards for things like flights, hotels, car rentals, and vacation packages. Some issuers also let you redeem travel rewards for statement credits and other non-travel options. In simple words more you purchase on travel more you earn rewards.

How to redeem points from my travel credit card?

Redemption depends on the type of travel card you have and its respective rewards program. There are 2 possible ways to redeem points. Either through an issuer’s online portal or by transferring your points or miles to an issuer’s travel partner.

What should I look for before getting a travel credit card?

Before applying for a travel card, check for the minimum salary requirement, annual fees, ongoing rewards structure, and first-year welcome bonus opportunity.

Advantages of a Travel Credit Card

●     Earn rewards on travel-related purchases

Travel cards get you bonus points every time you make travel-related purchases like airfare, hotels, car rentals, trains, taxis, rideshares, and more. You can plan your next trip once you have a good collection of these bonus points. You may even get a free business class flight or free luxury hotel stay in one of the European countries. There are some travel credit cards that offer welcome bonuses to customers that can be used for air travel fares or hotel stays.

●     Zero foreign transaction fees

Most debit cards and credit cards charge you a certain transaction fee every time you use it in a foreign country or do a transaction in foreign currency. This charge is around 3% of your total transaction. Which could be a big amount in foreign currency and can add up to the total of your monthly credit card fees. In this case, if you have a travel credit card you can save this amount with no transaction fees.

●     No risk of fraud and theft

If you are traveling to foreign countries with some cash, debit card, or credit card you must get worried about its safety as there is a risk of theft and phishing. The bank details can be stolen and the information can be used for unauthorized transactions. And you will be liable to bear this loss. But if you have a travel credit card or traveler card then you get protection against fraud liability keeping all your money-related worries away.

●     Lost Baggage Insurance

Loss of luggage is really very stressful situation that can happen while traveling in foreign countries. A good travel credit card provides you insurance against loss of baggage and this can be a big relief when you lose your valuables and luggage in a foreign country.

●     Accidental Insurance Benfits

Accidents or any type of disaster can happen during your international travel. In such cases, it could be difficult to recover losses unless you have good travel insurance coverage. There are some good travel credit cards that provide travel accidental coverage that help you to get reimbursement if anything disaster happens to you or your family members during your trip.

●     Authorized users may also get travel benefits

Some travel credit cards offer travel benefits to authorized users in addition to a cardholder. Authorized users also get benefits like access to the airport lounge. But you should always check if you need to pay additional fees to add authorized people as some travel credit cards don’t offer this facility.

●     High-value benefits that are worth the annual fee alone

If you check with the welcome bonus and other benefits of a travel card it is really worth the annual fee. If you are a frequent international traveler then definitely having a travel credit card offers you high-value benefits like a complete international trip with free flight, hotel stay, etc. and you will consider it worth paying its annual fees.

Suggested Read: Top 15 best international travel apps for travelers from UAE

Disadvantages of Travel Credit Card

●     High annual fees

There are some premium travel credit cards that come with very high annual fees. But not every travel credit card has too high annual fees. You need to decide and select the best travel card with reasonable annual fees according to your travel frequency a year and the amount of usage.

●     It can be hard to maximize the value

It can be really hard to get maximum value out of your travel credit card. You need to keep a constant eye on the bonus points to enjoy real benefits from a travel credit card. The major key to maximizing value is to understand your card’s benefits and use them effectively. Airlines and hotels may impose blackout dates for when you can use your points or miles or may have limited inventory for reward redemption. To avoid this you should check with the blackout or expiration dates and read all the terms and conditions, too before redemption of your points.

●     High credit score requirements

Many travel cards that come with the most valuable rewards, also tend to require high credit scores. Therefore if you haven’t established your credit yet or have had some problems in the past, these cards may not be available to you until you drive those scores up.

●     Not worth it if you don’t travel enough

Travel credit cards are not for you if you are not a frequent international traveler. As it could be difficult for you to earn bonus points on travel purchases. The more you travel the more you earn bonus points and the more you can use it for your next trip.

●     The value of your rewards may fluctuate

Airlines and hotels can keep on changing their loyalty programs which affect the benefits you get from the points that you earned with your previous travel purchases. To avoid this you need you use your points in a timely manner. Don’t be greedy waiting for the maximum number of reward points to get collected. Use them to ensure you’ll get maximum value at present in case an airline or hotel devalues them in the future.

●     High Annual Percentage Rates(APRs)

Travel credit cards are only worth it if you can pay off your bill in full each month as most of the travel cards tend to have high APRs. Many travel cards have more APRs than a normal credit card. Having to pay high-interest rates will negate any travel rewards earned. So if you can’t pay your card off every month, it’s best to opt for a card with a lower variable APR.

What are the best travel credit cards in the UAE?

Below are the highly recommended banks you should approach to get the best travel credit card as per your requirements.

• ADCB traveler card
• HSBC travel credit card
• Emirates NBD Globalcash Card
• Citi Bank Travel Credit Card

Conclusion:

If you are a frequent international traveler yet do not have a travel credit card then you are missing a lot of potential benefits that you can get on air travel, hotel reservations, car rentals, and many other travel-related transactions. Check for the best travel credit card suitable to you according to salary requirements, annual fees, and the perks it offers. Contact us for any of your international travel requirements. We wish you happy and safe travel!